PPR, Prada Said to Be Among Suitors of Jeweler Pomellato

March 1 (Bloomberg) -- Pomellato SpA, the closely held
jeweler whose trinkets have been worn by actress Tilda Swinton,
has received expressions of interest from at least four luxury-goods makers, according to a person familiar with the situation.

PPR SA, Prada SpA and Swarovski are among companies that
have held talks with the Milan-based company, said the person,
who asked not to be identified as the information is
confidential. While no final decision has been made, a deal
could be reached this month, the person said.

Pomellato, known for its M’ama non m’ama stacking rings,
shelved a plan to sell shares in an initial public offering
after Italy’s election this week produced a hung parliament.
That “forces us to look into alternative courses of action, you
have to look at other sources of capital,” Chief Executive
Officer Andrea Morante said in a Feb. 26 Bloomberg TV interview.

Pomellato sales rose about 10 percent to almost 150 million
euros in 2012, according to the person. Earnings before
interest, tax, depreciation and amortization reached about 23
million euros. The jeweler has an enterprise value of about 270
million euros ($351 million) to 300 million euros, Thomas
Mesmin, an analyst at CA Cheuvreux in Paris, estimates.

Swatch Group AG’s $1 billion acquisition of Harry Winston
Diamond Corp.’s watch and jewelry unit has spurred interest in
Pomellato, said the person. Founder Pino Rabolini is weighing
selling a stake to a strategic partner to help the maker of 700-euro Rouge Passion rings develop globally, the person said.

No Overlap

Officials at PPR and Prada declined to comment. A Swarovski
official said she couldn’t immediately comment. Swatch may also
be interested in the jeweler, Pambianco News reported last
month. The biggest maker of Swiss timepieces doesn’t need
anything else after buying Harry Winston, Beatrice Howald, a
spokeswoman, said by e-mail.

PPR is looking to acquire brands that do not overlap with
its existing portfolio, Alexis Babeau, managing director of the
Paris-based company’s luxury division, said in January after it
bought stakes in Chinese jeweler Qeelin and British fashion
designer Christopher Kane. LVMH Moet Hennessy Louis Vuitton SA,
which in 2011 purchased Roman jeweler Bulgari, sees more
consolidation in the so-called hard-luxury segment, the head of
its watch and jewelry unit said in November.

Buying Pomellato would make more sense for PPR than Prada
and could be interesting for Swarovski, CA Cheuvreux’s Mesmin
said.

“I would think companies like PPR or LVMH could end up
securing the deal,” said Luca Solca, an analyst who heads
luxury-goods research at Exane BNP Paribas in London. “As
jewelry brands are few and far apart, I would expect valuations
to be skewed to the higher as the recent Harry Winston deal
suggests.”